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By Mike Paulenoff, www.MPTrader.com
The US Oil Trust ETF (NYSE: USO) has plunged over 6% from its early morning rally peak, which is not a surprise from a volatility perspective, but it is a surprise to me IF I thought that a more bullish pattern was under development. In other words, the plunge in the USO has taken back too much of its prior rally to be considered the start of a new bull move. The entire upmove from the Dec 5 low at 33.08 to this morning's high at 40.73 likely completed the initial rally phase of an intermediate-term period of oil price recovery. If my work proves correct, then somewhere in the vicinity of 36.90-37.10 the USO should stabilize and pivot to the upside for another loop up towards 42.00-43.00.
Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!
